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At the top of the list is Cisco. The company started its fiscal 2013 just as it ended 2012, with another earnings beat. The network giant reported net income of $2.6 billion, or 48 cents per share, on revenue of $11.9 billion.

Not only was this enough to beat analysts' estimates of 46 cents per share, but the results also represented 11% profit growth. Likewise, revenue grew by 6% -- exceeding Street expectations of $11.77 billion.

Cisco continues to see excellent improvement in its services business with revenue growing year-over-year by 12%. Some of the company's largest customers have contributed to the growing demand as evident by the 9% increase in orders. But that was not the case for the company's core routing and switching business which continues to underperform. The company has responded by opening its wallet.

The company's recent shopping spree includes spending $1.2 billion for
Meraki and most recently $141 million in cash for
Cariden. In all, Cisco completed nine cloud-based acquisitions last year.

The company is using these deals to leverage its strong services business, which grew last year by 12%. That Cisco has been investing heavily in this direction is not a surprise, particularly since that market is projected to grow to $177 billion by 2015.

In the meantime, the company is looking for any type of competitive advantage. The company is willing to leave no stone unturned to find growth opportunities -- regardless of how much it cost. Investors would be wise to add shares at current levels as the stock has a good opportunity to trade in the $25 to $30 range during the course of the next 12 months.

Another stock investors should keep an eye on is Brocade. Despite gaining just above 2% last year, there is a lot to like with the company's business. Although Brocade has performed quite well this year, the market seems to show no interest in discussing the company's prospects unless it involves M&A speculation. Also, it seems the company's strong fourth-quarter performance has only served to fuel that fire.